Terrebonne Parish Fire Protection District No. 5 · 2020. 8. 5. · Decreased ad valorem tax...

FIRE DISTRICT NO. 5

Of the Parishes of Terrebonne and Lafourche

Under provisions of state law, this report is a puohcdocument, Acopy of the report has been submitted tothe entity and other appropriate public officials. Thereport is available for public inspection at the BatonRouge office of the Legislative Auditor and, whereappropriate, at the office of the parish clerk of court.

Release Date 1/53/6 $^—^-/

STAGNI & COMPANY, LLC

FIRE DISTRICT NO. 5ANNUAL FINANCIAL REPORT

As of and for the Year Ended December 31, 2007

TABLE OF CONTENTS

MANAGEMENT'S DISCUSSION AND ANALYSIS

FINANCIAL SECTION

Independent Auditor's Report 7Basic Financial Statements:

Statement of Net Assets 9Statement of Activities 10Balance Sheet - Governmental Fund -General Fund 11Statement of Revenues, Expenditures, and Changes in Fund Balances -

Governmental Fund - General Fund 12Notes to the Financial Statements 13

REQUIRED SUPPLEMENTAL INFORMATIONBudget Comparison Schedule - General Fund 24

REPORTS REQUIRED ACCORDING TO GOVERNMENT AUDITING STANDARDS

REPORT ON COMPLIANCE AND ON INTERNAL CONTROLOVER FINANCIAL REPORTING BASED ON AN AUDIT OFBASIC FINANCIAL STATEMENTS PERFORMED IN ACCORDANCEWITH GOVERNMENT AUDITING STANDARDS 26

SCHEDULE OF CURRENT YEAR FINDINGS 27

Status of Prior Year Findings 28

FIRE DISTRICT NO. 5Of the Parishes of Terrebonne and Lafourche

MANAGEMENTS DISCUSSION AND ANALYSISFor the Year Ended December 31, 2007

This discussion and analysis of the Fire District No. 5's financial performance provides anarrative overview of the financial activities as of and for the fiscal year ended December31, 2007. Please read it in conjunction with the basic financial statements and theaccompanying notes to the financial statements.

FINANCIAL HIGHLIGHTS

Our financial statements provide these insights into the results of this year's operations:• The net assets increased as a result of this year's operations. Net assets of our

governmental activities increased slightly by $5,907. At the end of the year assetsexceeded liabilities by $579,296 (net assets).

• During the year, expenses for fire protection services were $185,279. Generalrevenues of $191,186 were recognized to end the year with revenue exceedingexpenses by $5,907. This compares to last year when revenues exceeded expensesby $8,633.

• Program expenses increased by $3,832 or about 2.1 %.

USING THIS ANNUAL REPORT

This annual report consists of a series of financial statements. The Statement of NetAssets and the Statement of Activities (Government-Wide Financial Statements) provideinformation about the governmental activities as a whole and present a longer-term view ofthe finances. The Balance Sheet and Statement of Revenues, Expenditures and Changesin Fund Balance - Governmental Funds (Fund Financial Statements) tell how serviceswere financed in the short term as well as what remains for future spending. Fund financialstatements also report the operations in more detail than the government-wide statementsby providing information about the most significant funds.

Our auditor has provided assurance in his independent auditor's report that the basicfinancial statements are fairly stated. The auditor, regarding the Required SupplementalInformation and the Other Supplemental Information is providing varying degrees ofassurance. A user of this report should read the independent auditor's report carefully toascertain the level of assurance being provided for each of the other parts in the AnnualReport.

Government-Wide Financial Statements

One of the most important questions asked about finances is, "Is the Fire District No. 5 as awhole better off or worse off as a result of the year's activities?" The Statement of NetAssets and the Statement of Activities report information as a whole and about activities in


MANAGEMENTS DISCUSSION AND ANALYSISFor the Year Ended December 31, 2007

a way that helps answer this question. These statements include all assets and liabilitiesusing the accrual basis of accounting, which is similar to the accounting used by mostprivate-sector companies. All of the current year's revenues and expenses are taken intoaccount regardless of when cash is received or paid.

These two statements report the net assets and changes in them. You can think of netassets—the difference between assets and liabilities—as one way to measure the financialhealth, or financial position. Over time, increases or decreases in net assets are oneindicator of whether its financial health is improving or deteriorating. You will need toconsider other non-financial factors, however, to assess the overall health of the FireDistrict No. 5.

Fund Financial Statements

The fund financial statements provide detailed information about the most significantfunds—not as a whole. Some funds are required to be established by State laws.

The Fire District No. 5 utilizes the governmental type of fund with the following accountingapproach. Most of the basic services are reported in governmental funds, which focus onhow money flows into and out of those funds and the balances left at year-end that areavailable for spending. These funds are reported using an accounting method calledmodified accrual accounting, which measures cash and all other financial assets that canreadily be converted to cash. The governmental fund statements provide a detailed short-term view of the general government operations and the basic services it provides.Governmental fund information helps you determine whether there are more or fewerfinancial resources that can be spent in the near future to finance programs. We describethe relationship (or differences) between governmental activities (reported in the Statementof Net Assets and the Statement of Activities) and governmental funds in reconciliation atthe bottom of the fund financial statements.

FINANCIAL ANALYSIS AS A WHOLE (GWFS)

Net assets increased slightly from $573,389 to $579,296. Unrestricted net assets—the partof net assets that can be used to finance day-to-day operations without constraintsestablished by debt covenants, enabling legislation, or other legal requirements—absorbedmost of the increase this year. The balance in net assets represents the accumulatedresults of all past years' operations.


MANAGEMENT'S DISCUSSION AND ANALYSISFor the Year Ended December 31, 2007

Our analysis below focuses on the net assets (Table A) and changes in net assets (TableB) of the governmental-type activities.

Table ACondensed Statement of Net Assets

2006Increase Percent

2007 (Decrease) Change

Current and Other AssetsCapital Assets

Total AssetsCurrent Liabilities

Total LiabilitiesInvested in Capital AssetsUnrestricted

Total Net Assets

$ 337,326407,873745,199171,810171,810407,873165,516

$ 573,389

$ 437,290382,991820,281240,985240,985382,991196,305

$579,296

$ 99,964(24,882)

75,08269,17569,175

(24,882)30,789$5,907

29.6%-6.1%10.1%40.3%28.7%-6.1%18.6%1.0%

Table BCondensed Statement of Activities

2006

$(181,447)

(181,447)190,0808,633

564,756$ 573,389

2007

$(185,279)

(185,279)191,1865,907

573,389$579,296

(Decrease)

$3,832

3,8321,106

(2,726)

8,633$5,907

Change

2.1%0.0%2.1%0.6%

-31.6%

1.5%1.0%

Total program expensesTotal program revenuesNet program incomeGeneral revenuesChange in Net AssetsNet Assets:Beginning of the yearEnd of the year

General revenues for the governmental activities increased slightly by approximately$1,000, while total expenses increased 2.1% ($3,832).



FINANCIAL ANALYSIS OF INDIVIDUAL FUNDS (FFS)

The Fire District No. 5 uses funds to help it control and manage money for particularpurposes. Looking at individual funds helps you consider whether the District is beingaccountable for the resources provided to it but may also give you more insight into theoverall financial health.

The general fund reported an ending fund balance of $196,305 of which the Board hasdesignated in the budget $20,000 for remaining FEMA reimbursable hurricane repairs and$125,000 for capital purchases. This reflects an increase of $30,789 or 19% from last year.

Total revenues for governmental funds were $195,502, an increase of approximately 3%from the prior year, primarily from ad valorem taxes received increased by $11,080 or 8%,

Current expenditures for fire protection activities were $141,949, an increase of $14,128 or11% from the prior year. Capital outlay equaled $18,448, a slight decrease of $1,052 or5% from the prior year.

GENERAL FUND BUDGETARY HIGHLIGHTS

The original budget for the General Fund was revised during the year. Authorized budgetamendments were approved as follows:

Original Budgeted Revenues

Amendments were made for

Increased Ad Valorem taxes

Increased State Revenue Sharing

Increased supplemental pay

Increased Fire Insurance Taxes

Increased Compensation for Property Damages;ncreased Interest

Total revenue amendments

Amended Budgeted Revenues

$171,600

15,650

650

750

3,850

2,250

3,000

23,900

$197,750

FIRE DISTRICT NO, 5Of the Parishes of Terrebonne and Lafourche


Original Budgeted Expenditures

Amendments were made for:Decreased ad valorem tax deductions &adjustments

Increased current expenditures

Increased Capital Outlay

Total expenditure amendments

Amended Budgeted Expenditures

$184,900

(1,300)

7,800

45,200

51,700

$236,600

CAPITAL ASSETS

Capital assets, net of accumulated depreciation of $428,860, for governmental activities atyear-end were $382,991. This year there were no deletions and $18,448 of additions.Depreciation of $43,330 was recorded on capital assets in the governmental activities.More detailed information about the capital assets is presented in Note 4 to the financialstatements.

ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES

Highlights of next year's General Fund budget include:

Condensed Summary of BudgetedFinances

Anticipated revenues

Expenditures:

Current

Capital outlayAnticipatedexpenditures

Excess of revenues

Fund Balance:

Beginning of the year

End of the year

2008$ 251,442

175,90010.000

185.90065,542

1,667

$ 67.209



CONTACTING FINANCIAL MANAGEMENT

This financial report is designed to provide a general overview of the Fire District No. 5'sfinances and to show accountability for the money it received. If you have questions aboutthis report or need additional financial information, contact:

Ms. Wanda LeCompte, CPA675 Aragon Road

Montegut, LAPhone number 985-594-5377

FINANCIAL SECTION

STAGNI & COMPANY, LLC,CERTIFIED PUBLIC ACCOUNTANTS 5. CONSULTANTS

INDEPENDENT AUDITOR'S REPORT

To the Commissioners ofFire District No. 5Of the Parishes of Terrebonne and Lafourche

We have audited the accompanying financial statements of the governmental activitiesand each fund of the Fire District No. 5, a component unit of Terrebonne ParishConsolidated Government as of and for the year ended December 31, 2007 whichcollectively comprise the basic financial statements as listed in the table of contents.These basic financial statements are the responsibility of the Fire District No. 5. Ourresponsibility is to express an opinion on these basic financial statements based on ouraudit.

We conducted our audit in accordance with auditing standards generally accepted inthe United States of America and Government Auditing Standards, issued by theComptroller General of the United States. Those standards require that we plan andperform the audit to obtain reasonable assurance about whether the financialstatements are free of material misstatement. An audit includes examining, on a testbasis, evidence supporting the amounts and disclosures in the basic financialstatements. An audit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluating the overall basicfinancial statement presentation. We believe that our audit provides a reasonable basisfor our opinion.

In our opinion, the basic financial statements referred to above present fairly, in allmaterial respects, the financial position of the governmental activities and each majorfund of the Fire District No. 5 as of December 31, 2007, and the respective changes infinancial position for the year then ended, in conformity with auditing standardsgenerally accepted in the United States of America.

In accordance with Government Auditing Standards, we have also issued a reportdated April 23, 2008, on our consideration of the Fire District No. 5's internal controlover financial reporting and our tests of its compliance with certain provisions of laws,regulations, contracts and grants. That report is an integral part of an audit performedin accordance with Government Auditing Standards and should be read in conjunctionwith this report in considering the results of our audit.

2O7 LAFAYE AVENUE • THIBODAUX, LA 7O3OI (985) 447-7226 '

14OI HUDSON UNE • SUITE 2OI • MONROE, LA 7I2OI (318)332-2870

FIRMWIDE FAX (985) 446-3O32

EMAIL: [email protected]

MEMBERS: AICPA • LCPA

To the Commissioners of theFire District No. 5Page 2

Management's Discussion and Analysis and the Required Supplementary Information,as listed in the foregoing table of contents, are not a required part of the basic financialstatements, but are supplementary information required by the accounting principlesgenerally accepted in the United States of America. We have applied certain limitedprocedures, which consisted principally of inquiries of management regarding themethods of measurement and presentation of the supplementary information.However, we did not audit the information and express no opinion on it.

&Companu

Thibodaux, LouisianaApril 28, 2008

8STAGM & COMPANY, LLC

FIRE DISTRICT NO. 5of the PARISHES OF TERREBONNE and LAFOURCHE

Statement of Net AssetsDecember 31, 2007

ASSETSCash $ 66,653Investments 125,901Ad Valorem taxes receivable 26,052Due from other governments 193,926Due from State of LA 17,044Prepaid Insurance 7,714Capital Assets, net of accumulated depreciation 382,991

TOTAL ASSETS $ 820.281

LIABILITIESCurrent Liabilities:

Accrued salaries $ 1,887Due to other governments 846Deferred revenue 238,252

Total current liabilities 240,985

TOTAL LIABILITIES 240,985

NET ASSETSInvested in capital assets, net of related debt 382,991Unrestricted 196,305

Total net assets $ 579,296

See notes to financial statements.9

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Balance Sheet - Governmental Fund - General FundDecember 31, 2007

ASSETSCash $ 66,653Investments 125,901Ad Valorem taxes receivable 26,052Due from other governments 193,926Due from State of LA 17,044Prepaid Insurance 7,714TOTAL ASSETS $ 437,290

LIABILITIES AND EQUITYCurrent Liabilities:

Accrued salaries $ 1,887Due to other governments 846Deferred revenue 238,252

Total current liabilities 240,985

TOTAL LIABILITIES 240,985

EQUITYFund balances:

Unreserved-Designated for Capital Purchases 125,000Unreserved - undesignated 71,305

Total equity 196,305

RECONCILIATION TO STATEMENT OF NET ASSETS:In the statement of net assets, capital assets used in governmental

activites are not financial resources and therefore are notreported in the governmental fund as above 382,991

Net assets of governmental activities $ 579,296



Statement of Revenues, Expenditures, and Changesin Fund Balances - Governmental Fund - General Fund

For the Year Ended December 31. 2007

REVENUESAd Valorem Taxes $ 149,661State Revenue Sharing 18,683State Supplemental Pay 4,350Fire Insurance Rebate 15,869Miscellaneous 10Interest 6.929

TOTAL REVENUES 195,502

EXPENDITURESGeneral government - current:

Ad valorem tax deductions 5,272Ad valorem tax adjustments 1.309Total general government - current 6.581

Public Safety - current:Salaries & Wages 41,597Payroll Taxes 2,996Retirement 4,565Group Health Insurance 15,538Unemployment 303Workmen's Compensation 2,997Employee Uniforms 203Office Supplies 591Medical and drug supplies 267Bunker Gear 871Communication Equipment 164Gasoline & Oil 2,532Operating Supplies 5,431Utilities & Telephone 3,828Insurance 17,909Dispatch Services 3,247Legal & Professional 6,858Travel & Training 1,444Miscellaneous 325Repairs & Maintenance 30.283Total public safety - current 141.949

Capital Outlay 18.448Total capital expenditures 18,448

TOTAL EXPENDITURES 166.978Excess (deficiencies) of revenues

over (under) expenditures 28,524

OTHER FINANCING SOURCES (USES)Compensation for Property Damage 2.265

TOTAL OTHER FINANCING SOURCES (USES) 2,265

NET CHANGE IN FUND BALANCES 30,789

FUND BALANCESBeginning of year 165J516End of year $196.305

RECONCILIATION TO THE STATEMENT OF ACTIVITIES:Net change in fund balances per above $ 30,789

In the statement of activites, the cost of assets purchased isallocated over the estimated useful life and depreciationon these assets is recorded. Capital outlay 18,448

Depreciation (43,330)

Change in net assets - governmental activities $ 5.907


FIRE DISTRICT NO. 5 of theParishes ofTeirebonne and Lafourche

Notes to the Financial StatementsFor the Year Ended December 31, 2007

The Fire District No. 5 (the District) is governed by a Board of Commissionersappointed by the Terrebonne Parish Consolidated Government organized under La.Revised Statute 40:1492, Terrebonne Parish Ordinance #6781 adopted August 13,2003, Terrebonne Parish Ordinance #6697 adopted November 10,2002 and LafourcheParish Ordinance #3109 adopted November 12, 2002. The District provides for theacquisition, construction, maintenance, and operations of fire protection and emergencymedical service facilities, for the purchase of fire trucks and other fire fighting oremergency medical service equipment and paying the cost of obtaining water for fireprotection purposes in the Parishes of Terrebonne and Lafourche.

Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Basis of Presentation

The accompanying basic financial statements have been prepared in conformity withgovernmental accounting principles generally accepted in the United States of America.The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles.

B. Reporting Entity

As the governing authority, the Terrebonne Parish Consolidated Government is thefinancial reporting entity for Terrebonne Parish. The majority of ad valorem tax revenue(99%) is received from Terrebonne Parish. Because the Terrebonne ParishConsolidated Government could by definition in statute be financially burdened by theFire District No. 5, the District was determined to be a component unit of theTerrebonne Parish Consolidated Government. The accompanying financial statementspresent information only on the funds maintained by the District and its component unitand do not present information on the Terrebonne Parish Consolidated Government,the general government services provided by that governmental unit, or the othergovernmental reporting entity.

The accompanying financial statements will be included in the comprehensive annualfinancial report (CAFR) of the Parish for the year ending December 31,2007.

13

FIRE DISTRICT NO. 5 of theParishes ofTerrebonne andLafourche


Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, (Continued)

C. Basis of Presentation

The accounting system is organized and operated on a fund basis whereby a separateself-balancing set of accounts is maintained for the purpose of carrying on specificactivities or attaining certain objectives in accordance with special regulations,restrictions or limitations. The various funds in the financial statements in this reportare as follows:

Governmental Fund TypeGovernmental funds account for all or most of the general activities. These funds focuson the sources, uses, and balances of current financial resources. Expendable assetsare assigned to the various governmental funds according to the purposes for whichthey may be used. Current liabilities are assigned to the fund from which they will bepaid.

The difference between a governmental fund's assets and liabilities is reported as fundbalance. In general, fund balance represents the accumulated expendable resourcesthat may be used to finance future period programs or operations. The following arethe governmental funds:

General Fund - The General Fund is used to account for all financial resourcesand expenditures except those required to be accounted for in other funds.

D. Measurement Focus / Basis of Accounting

Fund Financial Statements (FFS)The amounts reflected in fund financial statements, are accounted for using a currentfinancial resources measurement focus. With this measurement focus, only currentassets and current liabilities are generally included on the balance sheet. Thestatement of revenues, expenditures, and changes in fund balances reports on thesources (i.e., revenues and other financing sources) and uses (i.e., expenditures andother financing uses) of current financial resources. This approach is then reconciled,through adjustment, to a government-wide view of operations.

The amounts reflected in the fund financial statements, use the modified accrual basisof accounting. Under the modified accrual basis of accounting, revenues arerecognized when susceptible to accrual (i.e., when they become both measurable andavailable).

14



Note 1 SUMMARY OF SIGNIFICANT ACCOUNTING POUCIES, (Continued)

D. Measurement Focus / Basis of Accounting (continued)

Available means that the resources will be collected within the current year or areexpected to be collect ed soon enough thereafter to be used to pay liabilities of thecurrent year. For this purpose, the District considers revenues to be available if theyare collected within 60 days of the end of the current fiscal year. Measurable meansthe amount of the transaction can be determined and available means collectible withinthe current period or soon enough thereafter to pay liabilities of the current period. Thecourt considers all revenues available if they are collected within 60 days after the fiscalyear end.

Expenditures are recorded when the related fund liability is incurred, except for interestand principal payments on general long-term debt which is recognized when due, andcertain compensated absences and claims and judgments which are recognized whenthe obligations are expected to be liquidated with expendable available financialresources. The governmental funds use the following practices in recording revenuesand expenditures:

Revenues - Ad valorem taxes and the related state revenue sharing are recorded asrevenue in the period for which levied, thus the 2006 property taxes which were leviedto finance the 2007 budget are recognized as revenue in 2007. The 2007 tax levy isrecorded as deferred revenue in the current financial statements. Charges for servicesare recorded when earned since they are measurable and available. Miscellaneousrevenues are recorded as revenues when received in cash by the District because theyare generally not measurable or available until actually received.

Expenditures - The major expenditures are recorded when payable or when the feesare incurred.

Government-Wide Financial Statements (GWFS)

The government-wide financial statements display information as a whole. Thesestatements include all the financial activities. Information contained in these statementsreflects the economic resources measurement focus and the accrual basis ofaccounting. Revenues, expenses, gains, losses, assets and liabilities resulting fromexchange or exchange-like transactions are recognized when the exchange occurs(regardless of when cash is received or disbursed).

15




Revenues, expenses, gains, losses, assets and liabilities resulting from non-exchangetransactions are recognized in accordance with the requirements of GASB StatementNo. 33, Accounting and Financial Reporting for A/on- exchange Transactions.

Program Revenues - Program revenues included in the column labeled Statement ofActivities are derived directly from users as a fee for services; program revenuesreduce the cost of the function to be financed from the general revenues.

E. Use of Estimates

The preparation of financial statements in conformity with accounting principlesgenerally accepted in the United States of America requires management to makeestimates and assumptions that affect certain reported amounts and disclosures.Accordingly, actual results could differ from those estimates.

F. Operating Budgets

As required by Louisiana Revised Statutes, The Board of Commissioners adopted abudget for the District's General Fund. The budgetary practices include public notice ofthe proposed budget and a public hearing on the budget prior of adoption. The Boardmust approve any amendment involving the transfer of monies from one function toanother, or increases in expenditures. The district amended its budget twice for theyear ended December 31, 2007. All budgeted amounts that are not expended orobligated through contracts lapse at year-end. The General Fund budget is adoptedon a basis materially consistent with accounting principles generally accepted in theUnited States of America.

G. Investments

Louisiana state law allows all political subdivisions to invest excess funds in obligationsof the United States or any other federally insured investments, certificates of deposit ofany bank domiciled or having a branch office in the state of Louisiana, guaranteedinvestment contracts and investment grade (A-1/P-1) commercial paper of domesticcorporations. Investments consist of deposits in the Louisiana Asset management Pool(LAMP). LAMP is an external pool which is operated in a manner consistent with theSEC's Rule 2a7 of the Investment Company Act of 1940. Rule 2a7 allows SEC-registered mutual funds to use amortized cost rather than fair value to report net assetsto compute share prices if certain conditions are met.

16

FIRE DISTRICT NO. 5 of theParishes ofTerrebonne and Lafourche

Notes to the Financial StatementsFor the Year Ended December 31,2007


H. Receivables

The financial statements for the District contain no allowance for uncollectible accounts.Uncollectible amounts due for ad valorem taxes are recognized as bad debts at the

time information becomes available which would indicate the uncollectibility of theparticular receivable. These amounts are not considered to be material in relation tothe financial position or operations of the funds.

I. Capital Assets

In the government-wide financial statements, additions, improvements and other capitaloutlays that significantly extend the useful life of an asset are recorded and depreciated(capitalized). Capital assets purchased or acquired with an original cost of $1000 ormore are valued at historical cost or estimated if historical cost is not available. Donatedassets are recorded as capital assets at their estimated fair market value at the date ofdonation. Other costs incurred for repairs and maintenance are expensed as incurred.

Depreciation of all exhaustible capital assets is recorded as an expense in theStatement of Activities, with accumulated depreciation reflected in the Statement of NetAssets. All capital assets, other than land, are depreciated using the straight-linemethod over the following estimated useful lives:

CATEGORY LIFEBUILDINGS ANDIMPROVEMENTS 5-40 YEARSMACHINERY & EQUIPMENT 5-20 YEARS

In the fund financial statements, capital assets purchased in governmental fundoperations are accounted for as capital outlay expenditures of the governmental fundupon acquisition.

17




J. Vacation and Sick Leave

Full time employees are entitled to 18 days vacation after one year of service. Eachyear the employee must take the vacation time before the anniversary date (the firstday of employment). If not taken before the anniversary date, the vacation time isforfeited. The vacation period is increased one day for each year of service over tenyears, up to a maximum period of thirty days. There is no material accumulatedvacation at year-end.

Every fireman in the employ of a fire protection district shall be entitled to full pay duringsickness or incapacity not brought about by his own negligence or culpable indiscretionfor a period of not less than fifty-two weeks. A fireman employed by any fire protectiondistrict who draws full pay during sickness or incapacity shall have such pay decreasedby the amount of workers' compensation benefits actually received by the employee. Afireman is entitled to sick leave benefits even though the injury or illness may haveoccurred while he was off duty. Firemen are not prohibited from engaging in part-timeemployment white receiving sick teave. A probationary fireman who is not a regular orpermanent fireman is not entitled to sick teave benefits provided by the District. Sickleave does not accumulate for employees; accordingly there is no accrued sick teave asof year-end.

K. Fund Equity

For government-wide financial statements net assets are classified and displayed inthree components:

1. Invested in capital assets - Consists of capital assets including restricted capitalassets, net of accumulated depreciation and reduced by the outstandingbalances of any bonds, mortgages, notes or other borrowings that areattributable to the acquisition, construction or improvement of those assets, ifany.

2. Restricted net assets - Consists of net assets with constraints placed on the useeither by (1) external groups such as creditors, grantors, contributions or laws orregulations of other governments; or (2) law through constitutional provisions orenabling legislation.

3. Unrestricted net assets - AH other net assets that do not meet the definition of"restricted" or "invested in capital assets, net of related debt."

18



K. Fund Equity (continued)

When both restricted and unrestricted resources are available for use, it is the District'spolicy to use restricted resources first, then unrestricted resources as they are needed.

In the fund financial statements, governmental fund equity is classified as fund balance.Fund balance is further classified as reserved and unreserved, with unreserved furthersplit between designated and undesignated. Any designations of fund balancerepresent tentative management plans that are subject to change.

Note 2 DEPOSITS AND INVESTMENTS

Deposits:

A summary of deposits are listed as follows:

Cash

Bank Balance

$72,529

ReportedAmount

$66,653

State law requires that deposits (cash and certificates of deposit) of all politicalsubdivisions to be fully collateralized at all times. Acceptable collateralization includesFDIC insurance and the securities purchased and pledged to the political subdivision.Obligations of the United States, the State of Louisiana and certain politicalsubdivisions are allowed as security for deposits. Obligations furnished, as securitymust be held by the political subdivision or with an unaffiliated bank or trust companyfor the account of the political subdivision. Under the provision of GASB, pledgedsecurities, which are not in the name of the governmental unit, are considereduncollateralized.

Custodial credit risk is the risk that in the event of a bank failure, deposits may not bereturned to it. The District has a written policy for custodial credit risk. As of year endnone of the bank balance of deposits was exposed to custodial credit risk.

19

Note 2



DEPOSITS (continued)

The Governmental Accounting Standards Board (GASB), which promulgates thestandards for accounting and financial reporting for state and local governments,considers these securities subject to custodial credit risk. Even though the pledgedsecurities are considered subject to custodial credit risk under the provisions of GASBStatement 40, Louisiana Revised Statute 39:1229 imposes a statutory requirement onthe custodial bank to advertise and sell the pledged securities within 10 days of beingnotified by the depositor that the fiscal agent has failed to pay deposited funds upondemand.

Investments:

Investment balances and maturities at year end are as follows:

Investment Type

Louisiana Asset Management Pool

As Reported

$125,901

Fair Value

$125,901

Ave DaysMaturity

26

For an investment, custodial credit risk is the risk that, in the event of a failure of thecounterparty, the District will not be able to recover the value of its investments orcollateral securities that are in possession of an outside party. Investments in externalinvestment pools are not exposed to custodial credit risk because of their naturaldiversification and the diversification required by the Securities and ExchangeCommission.

LAMP, a local government investment pool, is administered by LAMP, Inc., a non-profitcorporation organized under the laws of the State of Louisiana, which was formed by aninitiative of the State Treasurer in 1993. While LAMP is not required to be a registeredinvestment company under the Investment Company Act of 1940, its investmentpolicies are similar to those established by Rule 2-a7, which governs registered moneymarket funds. The primary objective of LAMP is to provide a safe environment for theplacement of public funds in short-term, high quality investments. The LAMP portfolioincludes only securities and other obligations in which local governments in Louisianaare authorized to invest. Accordingly, LAMP investments are restricted to securitiesissued, guaranteed, or back by the U.S. Treasury, the U.S. Government, or one of itsagencies, enterprises, or instrumentalities, as well as repurchase agreementscollateralized by those securities.

20



Note 2 DEPOSITS AND INVESTMENTS (continued)

The dollar weighted average portfolio maturity of LAMP assets is restricted to not morethan 90 days, and consists of no securities with maturity in excess of 397 days. The fairvalue of investments is determined on a weekly basis to monitor any variances betweenamortized cost and fair value. For purposes of determining participants' shares,investments are valued at amortized cost, which approximates fair value. LAMP isdesigned to be highly liquid to give its participants immediate access to their accountbalances.

Note 3 AD VALOREM TAXES

Property taxes are levied each November 1 on the assessed value listed as of the priorJanuary 1 for all real property, merchandise and movable property located in the Parish.Assessed valued are established by the Parish Assessor's Office and the State TaxCommission at percentages of actual value as specified by Louisiana law. Areevaluation of all property is required to be completed no less than every four years.The last reevaluation was completed for the list of January 1, 2004. Taxes are due adpayable December 31 with interest being charged on payments after January 1. Taxescan be paid through the tax sale date, which is the last Wednesday in June. Propertiesfor which the taxes have not been paid are sold for the amount of the taxes. The taxrate for the year ended December 31, 2007 was 12.12 mills of assessed valuation onproperty within Terrebonne and Lafourche Parish Fire District No. 5 for the purposeproviding fire protection within the District.

21

FIRE DISTRICT NO. 5 of theParishes of Terrebonne and Lafourche


Note 4 CAPITAL ASSETS

Information about capital assets and depreciation for the year are summarized asfollows:

Beginning EndingBalance Additions Deletions Balance

NON-DEPRECIABLE ASSETS

, . $ 125,165 $ " $ 125,165Land

DEPRECIABLE ASSETS:

Buildings & Improvements 7,169 7,169

xi u- i KA u- o n • * 661,069 ,0^0 679,517Vehicles, Machinery & Equipment ; 18,448 |__

T * r / •» * * j - i - i i. 668,238 An A An 686,686Total Cost of depreciable assets 18,448 '

T * I O * 4 * 793,403 * Q A A Q ~ 811,851Total Cost of assets 18,448

ACCUMULATED DEPRECIATION

Buildings & Improvements 7,080 90 7,170

Vehicles, Machinery & Equipment 378.450 43241 421.691

Total accumulated depreciation 385'530 43'330 " 428'860

Net depreciable assets $ 282,708 $ 257,826

Net capital assets $ 407,873 $ 382,991

Depreciation Expense of $43,330 was recorded in the governmental activities.

Note 5 DUE FROM OTHER GOVERNMENTAL UNITS

Amounts due from other governmental units consisted of $193,926 due from theTerrebonne and Lafourche Parish Tax Collectors for ad valorem taxes collected but notyet remitted.

Note 6 DEFINED BENEFIT PENSION PLAN

PLAN DESCRIPTION - The District contributes to the Firefighters' Retirement System ofLouisiana (the System), a cost-sharing multiple-employer defined benefit public retirementsystem, which is controlled and administered by a separate Board of Trustees. TheSystem provides retirement, deferred and disability benefits, survivor's benefits and costof living adjustments to plan members and beneficiaries. Act 434 of the 1979 LouisianaLegislative Session established the plan.

22



Note 6 DEFINED BENEFIT PENSION PLAN (continued)

The System is governed by Louisiana R.S. 11:2251 - 11:2269, specifically, and othergeneral laws of the State. The System issues a publicly available financial report thatincludes financial statements and required supplementary information for the System.The report may be obtained by writing to Firefighters' Retirement System of Louisiana,2051 Silver-side Dr., Suite 210, Baton Rouge, LA 70808-4136 or at their websitehttp://www.iafirefightersret.com.

FUNDING POLICY - Plan members are required to contribute 8% of their eamabiecompensation and the District is required to contribute an actuarially determined rate. Forthe current year, the rate the District contributed to the retirement system ranged from15.5 to 13.75%. The contribution requirements of plan members and the District areestablished and may be amended by state statute. The District's contributions to theSystem for the years ending December 31, 2005, 2006, and 2007 were $5,995, $6,066,and $4,565 respectively and are included in Salaries and Benefits on the fund financialstatement.

Note 7 SUPPLEMENTAL PAY

In addition to the compensation paid to employees, firemen may be eligible to receivesupplemental pay. The amount of the compensation is determined by State Law and isrevised periodically. During the current year the District has recognized revenue andexpenditures of $4,350 in salary supplements received from the State.

Note 8 RISK MANAGEMENT

The District is exposed to various risks of loss related to workmen's compensation; torts;theft of, damage to and destruction of assets; errors and omissions; and natural disastersand group health benefits for which the District carries commercial insurance and alsoparticipates in the Parish's risk management program for general liability and workers'compensation and group health. The premiums for auto liability are paid to the Parish forreimbursement of commercial carrier premiums. No settlements were made during theyear that exceeded the District's insurance coverage.Note 9 COMPENSATION OF BOARD MEMBERS

No compensation was paid to Board Members for the year.

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REQUIRED SUPPLEMENTALINFORMATION

FIRE DISTRICT NO. 5

of the PARISHES OF TERREBONNE and LAFOURCHEBudget Comparison Schedule - General Fund

For the Year Ended December 31, 2007

OriginalBudgets

FinalREVENUES

Ad Valorem TaxesState Revenue SharingState Supplemental PayFire Insurance RebateMiscellaneousInterest

TOTAL REVENUES

EXPENDITURESGeneral government - current

Ad valorem tax deductionsAd valorem tax adjustments

Total general government - current

Public safety - current:Salaries & WagesPayroll TaxesRetirementGroup Health InsuranceUnemploymentWorkmen's CompensationEmployee UniformsOffice SuppliesMedical and drug suppliesBunker GearCommunication EquipmentGasoline & OilOperating SuppliesUtilities & TelephoneInsuranceDispatch ServicesLegal & ProfessionalTravel & TrainingMiscellaneousRepairs & Maintenance

Total public safety - currentCapital expendituresTotal capital expendituresTOTAL EXPENDITURESExcess (deficiencies) of revenues

over expenditures

OTHER FINANCING SOURCES (USES)Compensation for Property Damage

TOTAL OTHER FINANCING SOURCES (USES)

NET CHANGE IN FUND BALANCES

FUND BALANCESBeginning of yearEnd of year

$134,00018,0003,600

12,000

4.000171,600

5.6502.4508,100

46,4003,6005,000

16,100400

4,0001,0002,000

5504,0001,8002,5007,6504,500

21,0503,3008,8001,5001,850

14.000150,00026,80026,800

184.900

(13,300)

-

(13,300)

62.727$ 49,427

$149,65018,6504,350

15,850

7.000195,500

5,3001,5006,800

43,6503,2004,600

17,000350

3,0001,5001,0001,0502,0001,0002.6007,6504,500

20,0003,3008,4002,000

11,80019.000

157.80072,00072.000

236.600

(41,100)

2,2502,250

(38,850)

165,517$ 126,667

Actual

$149,66118,6834,35015,869

106,929

195,502

5,2721.3096,581

41,5972,9964,56515,538303

2,997203591267871164

2,5325,4313,82817,9093,2476,8581,444325

30.283141.94918.44818,448166,978

28,524

2,2652,265

30,789

165.516$ 196.305

VarianceFavorable

(Unfavorable)

$ 1133-1910(71)2

28191219

2,05320435

1,462473

1,297409783

1,129836268

2,219672

2,09153

1,542556

11,475(11,283)15,85153.55253,55269,622

69,624

1515

69,639

(1)$ 69.638

24

REPORTS REQUIRED BY GOVERNMENTAUDITING STANDARDS

STAGNI & COMPANY, LLCCERTIFIED PUBLIC ACCOUNTANTS & CONSULTANTS

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ONCOMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL

STATEMENTS PERFORMED IN ACCORDANCE WITHGOVERNMENT AUDITING STANDARDS

To the Commissioners ofFire District No. 5Of the Parishes of Terrebonne and Lafourche

We have audited the financial statements of the Fire District No. 5; a component unit ofTerrebonne Parish Consolidated Government as of and for the year ended December31, 2007, and have issued our report thereon dated April 28, 2008. We conducted ouraudit in accordance with auditing standards generally accepted in the United States ofAmerica and the standards applicable to financial audits contained in GovernmentAuditing Standards, issued by the Comptroller General of the United States.

Internal Control Over Financial Reporting

In planning and performing our audit, we considered Fire District No. 5's internal controlover financial reporting as a basis for designing our auditing procedures for the purposeof expressing our opinion on the financial statements, but not for the purpose ofexpressing an opinion on the effectiveness of the internal control over financialreporting. Accordingly, we do not express an opinion on the effectiveness of the internalcontrol over financial reporting.

A control deficiency exists when the design or operation of a control does not allowmanagement or employees, in the normal course of performing their assigned functions,to prevent or detect misstatements on a timely basis. A significant deficiency is a controldeficiency, or combination of control deficiencies, that adversely affects the entity'sability to initiate, authorize, record, process, or report financial data reliably inaccordance with generally accepted accounting principles such that there is more thana remote likelihood that a misstatement of the entity's financial statements that is morethan inconsequential will not be prevented or detected by the entity's internal control.

25

2O7 LAFAYE AVENUE • THIBODAUX, LA 7O3OI (985) 447-7226

I4OI HUDSON LANE • SUITE 2O I • MONROE, LA 7I2OI (3 I 8) 322-287O

FIRMWIDE FAX (985) 446-3O32

EMAIL: [email protected]

MEMBERS: AICPA • LCPA

To the Board of CommissionersFire District No. 5Page 2

A material weakness is a significant deficiency, or combination of significantdeficiencies, that results in more than a remote likelihood that a material misstatementof the financial statements will not be prevented or detected by the entity's internalcontrol.

Our consideration of internal control over financial reporting was for the limited purposedescribed in the first paragraph of this section and would not necessarily identify alldeficiencies in internal control that might be significant deficiencies or materialweaknesses. We did not identify any deficiencies in internal control over financialreporting that we consider to be material weaknesses, as defined above.

Compliance and Other Matters

As part of obtaining reasonable assurance about whether Fire District No. 5's basicfinancial statements are free of material misstatement, we performed tests of itscompliance with certain provisions of laws, regulations, contracts and grants,noncompliance with which could have a direct and material effect on the determinationof financial statement amounts. However, providing an opinion on compliance withthose provisions was not an objective of our audit, and accordingly, we do not expresssuch an opinion. The results of our tests disclosed no instances of noncompliance thatare required to be reported under Government Auditing Standards.

This report is intended for the information of the Board of Commissioners, managementthe State of Louisiana and the Legislative Auditor for the State of Louisiana and is notintended to be and should not be used by anyone other than these specified parties.Under Louisiana Revised Statute 24:513, this report is distributed by the LegislativeAuditor as a public document.

C7* (Somponu

Thibodaux, LAApril 28, 2008

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Fire District No. 5Of the Parishes of Terrebonne and Lafourche

SCHEDULE OF CURRENT YEAR FINDINGSFor the Year Ended December 31,2007

We have audited the basic financial statements of the Fire District No. 5, a componentunit of Terrebonne Parish Consolidated Government, which collectively comprise thebasic financial statements as of and for the year ended December 31, 2007, and haveissued our report thereon dated April 28, 2008. We conducted our audit in accordancewith auditing standards and the standards generally accepted in the United States ofAmerica applicable to financial audits contained in Government Auditing Standards,issued by the Comptroller General of the United States.

Our opinion on the basic financial statements was unqualified.

Section I - Summary of Auditor's Reports

a. Report on Internal Control and Compliance Material to the Financial Statements

Internal ControlMaterial Weaknesses IX NoSignificant Deficiencies EX NoCompliance

Compliance Material to Financial Statements [X No

b. Federal Awards N/A

Internal ControlMaterial Weaknesses [Significant Deficiencies £Type of Opinion On Compliance Unqualified D

For Major Programs Disclaimer DAre their findings required to be reported in accordance with Circular A-133, Section

.510(a)? D

c. Identification of Major Programs: N/A

CFDA Number (s) Name of Federal Program (or Cluster)Dollar threshold used to distinguish between Type A and Type B Programs:Is the auditee a 'low-risk1 auditee, as defined by OMB Circular A-133? D

Section II Financial Statement Findings

NONE

Section III Federal Award Findings and Questioned CostsN/A

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Status of Prior Year FindingsFor the Year Ended December 31, 2007

SECTION

2006-1

SECTION

I - INTERNAL CONTROL AND COMPLIANCEMATERIAL TO THE FINANCIAL STATEMENTS

The District did not publish all official proceedingsof the Board in the official journal.

II - INTERNAL CONTROL AND COMPLIANCEMATERIAL TO FEDERAL AWARDS

STATUSResolved.

NOT APPLICABLE

SECTION II - MANAGEMENT LETTERNONE ISSUED

NOTES TO SCHEDULE:This summary schedule includes all prior audit findings and management letter findings.

In the reference number, the first 4 digits are the year that the audit finding related to.

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